Eye on Employment: October 2018 Edition

The Eye on Employment is NWPB’s monthly breakdown of the latest data from Statistics Canada’s Labour Force Survey. In this document, we will provide you with a summary of changes in local labour market indicators, offer comparisons to historical benchmarks, and show how seasonality affects employment in Niagara.

First, a foreword on our source: Statistics Canada’s Labour Force Survey or LFS. The LFS is a robust tool that provides us with a considerable amount of data. At its core, however, it exists to sort Canadians into one of three groups: people who are employed, people who are not employed but looking for work, and people who are not in the labour force. This is a people-focused survey, and the important thing to remember is that a count of people is not a count of jobs. People might do a job, either for an employer or through self-employment, but the LFS is counting the people, not the job. Bearing this in mind, let’s turn our eye toward employment.

Month-over-month, we can see 800 fewer people either working or looking for work (a decrease in the labour force) between August and September 2018. There were 1,000 more people in full-time employment in September 2018 compared to August 2018, with a decrease of 1,300 individuals working in a part-time capacity. Compared to this time last year, September 2018 reports 2,900 more people with employment than were observed in September 2017. However, this overall increase is driven by considerable changes in full-time and part-time employment between September 2017 and September 2018. Specifically, September 2018 saw 3,100 fewer people employed in a full-time capacity and 6,000 more people employed in a part-time capacity than in September 2017.

Niagara’s unemployment rate decreased from 7.3% in August to 7.1% in September. This decrease occurred alongside the month-over-month employment rate decreasing from 58.2% to 58.1%. Niagara’s labour market participation rate fell from 62.8% to 62.5%. In an ideal state of affairs, decreases in the unemployment rate would also be met with increases in the participation and employment rate. When all three indicators fall, it is generally an indication of people leaving the labour force.

It’s also important to keep in mind that the data in Table 1 are seasonally unadjusted figures. That means factors like holidays, expected employment slowdowns or pickups due to weather, and other factors that can be reasonably be predicted to influence employment are not accounted for in these data. Table 2 shows what the labour force looks like when we adjust for seasonality.

Here, the month-over-month comparisons show some slightly different trends compared to the unadjusted figures. Table 2 shows that there were 100 fewer people employed in Niagara between September and August 2018. The unemployment rate increased from 7.4% in August to 7.5% in September 2018, and the employment rate decreased from 57.0% to 56.9%. The participation rate remained constant at 61.5% between August and September.

With the seasonally adjusted data showing 4,200 fewer people employed in Niagara in September compared to the unadjusted data, one might be tempted ask which one of these figures is correct.

The answer is that both are equally valid. Both measures are essential tools to understanding labour force trends in Niagara. In this case, the difference between the two figures is a strong indication that seasonal factors in the economy are having an impact on local employment indicators. We can see the effect of those seasonal factors as something that is giving a boost to the local labour market. In the absence of these seasonal factors, the seasonally adjusted data tell us that we would expect to see fewer employed people in the region.

The Youth Lens

LFS data also allow us a snapshot of youth (defined as people age 15 to 24) employment in Niagara. Once again these data do not account for seasonality.

Here we see 1,900 fewer youth working in September compared to August. There were 400 more youth working in a full-time capacity, and 2,200 fewer youth working in a part-time capacity (note here that Statistics Canada rounds to the nearest hundred; this accounts for what might present as irregular math on the part of the total employment changes). September saw the youth unemployment rate decrease from 14.0% to 13.3%, and the participation rate fell from 78.2% to 74.0%. Similarly, the employment rate fell from 67.3% to 64.2%. Given a month-over-month decrease in the number of unemployed youth in September it is likely we are seeing the effects of youth returning to education and training in September. However, these data, particularly when compared to September 2017, suggest a large number of youth remain engaged in looking for work.

Would you like to know more? NWPB is ready for your questions. Reach out to NWPB’s CEO, Mario De Divitiis.